A key vote by the European Union (EU) will take place later on whether to impose large tariffs on electric vehicles imported from China.
The move to impose tariffs is aimed at protecting the European auto industry from being weakened by what EU politicians believe are unfair Chinese state subsidies on its own cars.
Charges of up to 45% could be imposed on electric cars made in China over the next five years if EU members back the proposal, but there are concerns that such a move could increase vehicle prices electricity (EV) to buyers.
The decision also risks sparking a trade war between Brussels and Beijing, which has denounced the tariffs as protectionist.
China is counting on high-tech products to help revive its weakening economy, and the EU is the biggest foreign market for its electric car industry.
China’s domestic auto industry has grown rapidly over the past two decades and the country’s auto brands have begun to enter international markets, causing concerns in countries such as the EU that companies Theirs won’t be able to compete with cheaper prices.
The EU imposed import tariffs of varying degrees on various Chinese manufacturers over the summer, but Friday’s vote will decide whether they are enforced.
The fees were calculated based on estimates of the amount of Chinese state aid each manufacturer received following the EU investigation. The European Commission sets separate obligations for three major Chinese electric vehicle brands – SAIC, BYD and Geely.
Figures show that in August this year, battery car registrations in the EU fell by 43.9% compared to a year earlier.
In the UK, demand for new electric vehicles has hit a new record, but sales are largely driven by on-trade deals and big manufacturer discounts, according to the industry trade body.
EU members remain divided over tariffs. Germany, whose auto industry depends heavily on exports to China, is unlikely to vote in favor of these.
German car manufacturers have spoken out against it. Volkswagen said it was taking the “wrong approach”.
However, France, Greece, Italy and Poland are likely to vote in favor of import tariffs. The EU proposal can only be blocked if a qualified majority of 15 members vote against it.
On Friday, SAIC – which owns the MG brand – said it would not change electric vehicle prices this year, regardless of the vote result.
